State Attorney General Jerry Brown today subpoenaed financial records and other documents from seven health insurance companies in California as part of an investigation into their practices.
Brown subpoenaed records from Aetna Health, Anthem Blue Cross, CIGNA, Health Net, Blue Shield of California, Kaiser Permanente, and PacifiCare to look into potential violations of the state’s unfair competition and false advertising laws.
“We have been looking at these companies for a number of months and are very concerned that some of them are unjustly raising premiums and denying payment of legitimate claims,” Brown said in a statement.
Anthem Blue Cross announced earlier this month that it planned to increase premium rates by as much as 39 percent for some members. Brown said his investigation will look into whether the other insurers are planning similar rate hikes, and whether Anthem’s rate increases are legal.
“Not only are the rate increases devastating to Californians strapped by the economy, but in same cases, they are possibly illegal,” he said.
The investigation will also explore how much money from the plans goes toward health care, as opposed to marketing, administration and profits. It will also examine how the companies review claims.
The subpoenas issued today cover pay-for-service plans, which reimburse doctors and hospitals for services performed. Brown’s office last month served subpoenas to the same companies for their HMO plans.
The state’s unfair competition and false advertising laws ban “any unlawful, unfair or fraudulent business act or practice” and the use of false or misleading statements to the public.
The companies have 30 days from today to hand over the records.
